Future of Work | @Deloitte @Time

Any discussion about the innovation of management processes necessarily leads to the future of work, how work gets done and how to retain talent that will ensure the organization is agile, flexible and able to compete in the fast-changing global environment. Time is the latest to publish their insightful Future of Work online.

Deloitte's innovative employment practices are featured:

It's a shift, in other words, from a corporate ladder to the career-path metaphor long preferred by Deloitte vice chair Cathy Benko: a lattice.

At Deloitte, each employee's lattice is nailed together during twice-a-year evaluations focused not just on career targets but also on larger life goals. An employee can request to do more or less travel or client service, say, or to move laterally into a new role — changes that may or may not come with a pay cut. Deloitte's data from 2008 suggest that about 10% of employees choose to "dial up" or "dial down" at any given time. Deloitte's Mass Career Customization (MCC) program began as a way to keep talented women in the workforce, but it has quickly become clear that women are not the only ones seeking flexibility. Responding to millennials demanding better work-life balance, young parents needing time to share child-care duties and boomers looking to ease gradually toward retirement, Deloitte is scheduled to roll out MCC to all 42,000 U.S. employees by May 2010. Deloitte executives are in talks with more than 80 companies working on similar programs.

Time also mentioned labour trends in their report with these indicators:

According to consulting giant McKinsey & Co., nearly 85% of new jobs created between 1998 and 2006 involved complex "knowledge work" like problem-solving and concocting corporate strategy. Job opportunities in mathematics and across the sciences are also expected to expand. The U.S. Department of Labor spotlights network systems and data communications as well as computer-software engineering among the occupations projected to grow most explosively by 2016. Over the next seven years, the number of jobs in the information-technology sector is expected to swell 24% — a figure more than twice the overall job-growth rate.

P.S. For those noticing the title, it's an experiment with tags for updating this post on my twitter feed: www.twitter.com/alanwunsche

Vital Signs: Google's others numbers!

In "Google: A Druckerian Ideal?", Rick Waltzman of the Drucker Institute unveils an interesting set of measures that help to tell the story behind the financials:

Google (GOOG) turned out quite a dazzling display of data recently when it released its third-quarter results: Profit jumped 46%. Revenue soared 57%. The company's shares shot up $6.14, to more than $639 each, on the news. But it's another set of figures that most impresses me: 17, $0, and 20%.

These refer, respectively, to the number of cafés at Google's Mountain View (Calif.) campus; what it charges employees for all the meals and snacks eaten there; and the amount of time it encourages its engineers to carve out each week to tackle company-related projects that interest them personally but aren't part of their core assignments.

The 20% Google allows engineers to follow their passions and this has resulted in innovative products such as Gmail, Google News, and the Sky feature on Google Earth. They've certainly taken a page from 3M's innovation playbook described in a recent article At 3M, A Struggle Between Efficiency And Creativity":

Official company policy allowed employees to use 15% of their time to pursue independent projects. The company explicitly encouraged risk and tolerated failure. 3M's creative culture foreshadowed the one that is currently celebrated unanimously at Google (GOOG ).

Thanks Rick for highlighting other vital signs that help us understand more of the story that underlies Google's financials!

Vital Sign: Competitiveness Rating. Top 40 Most Competitive Companies in 2007

According to "Most Competitive Companies 2007", a report on competitiveness of consumer oriented companies, a Competitive Rating (CR) represents a company’s ability to earn a consistent profit above their cost of capital, and their ability to protect that profit through multiple sources of ompetitive advantage with consumers.

The Top 5 Competitive Companies:
1. Google Search
2. Bud / Bud Light
3. Coca-Cola
4. Food Network Channel
5. Under Armour

The last two were a surprise, given that recent revenues for FNC and UA were less than 10% of the top 3 in the list.

According to W Ratings, the author of the report:

The competitiveness score is calculated by percentile, ranking companies by their average economic profit over the past five years and by their total moat score, and weighting those rankings equally into one score.

"Economic profit" is defined as a company's return on invested capital in excess of the company's weighted average cost of capital. Additionally, W Ratings measures a company's ability to achieve a higher economic profit than its rivals and sustain that competitive advantage through "moats," a term popularized by investment guru Warren Buffet when describing the qualitative measurement of a company's ability to keep competitors from penetrating their market for an extended period of time. Total moat score is derived from a consumer survey database and is defined as the sum of nine areas of competitive advantage with each area, or moat, measuring between negative one and five. The more moats and higher total moat score indicate a higher likelihood of sustaining a competitive advantage with consumers. To be considered, companies must have either a dominant market share or wide recognition among the general U.S. population and have publicly available financial data. Sectors surveyed comprise retail and consumer goods, media and communications, financial services, travel and leisure, and restaurant and beverage.

Report available as a download here: http://www.wratings.com/freereport.pdf